Vtech 2003 Annual Report Download - page 47

Annual Report 2003 45
Notes to the Financial Statements
20. SHARE CAPITAL, SHARE OPTIONS AND WARRANTS (continued)
As at 31st March 2003, the number of shares issuable under the
options granted pursuant to the 2001 Scheme was 17,150,000,
Number of Number of Number of
Balance in share options share options share options Balance in
issue at granted exercised lapsed/cancelled issue at
Date of grant (Note 1) Exercise price Exercisable period (Note 2) 1st April 2002 during the year during the year during the year 31st March 2003
26th February 2002 HK$10.2 26th February 2002 18,535,000 — — (3,105,000 ) 15,430,000
to 26th March 2002 to 25th March 2012
10th July 2002 HK$8.71 10th July 2002 — 2,125,000 — (405,000 ) 1,720,000
to 8th August 2002 to 7th August 2012
18,535,000 2,125,000 — (3,510,000 ) 17,150,000
which represented approximately 7.6% of the issued share capital
of the Company. The movements in the number of share options
under the 2001 Scheme during the year were as follows:
Note 1: Due to the large number of employees participating in the 2001 Scheme,
the information can only be shown within a reasonable range in this
report. For options granted to employees, the options were granted during
the underlying periods for acceptance of the offer of such options by the
employees concerned.
Note 2: As one of the conditions of grant, the employees concerned agreed with
the Company that the options shall not be exercisable within the period of
36 months from the date on which such options were granted or deemed
to be granted and accepted and shall not be exercisable after 60 months
from the date on which such options were granted or deemed to be
granted and accepted.
HomeRelay Plan Pursuant to the stock option plan adopted by
HomeRelay Communications, Inc. (“HomeRelay” formerly known
as Unbound Communications, Inc.) in August 2000 (the
“HomeRelay Plan”), the directors of HomeRelay may grant options
to the employees of HomeRelay up to 10% of HomeRelay’s
common stock in issue from time to time for incentive purposes.
Options for common stock may be incentive stock options or
non-statutory stock options. A committee designated by the
directors of HomeRelay may fix the terms and vesting of all stock
options; however, in no event will the contractual term exceed 10
years. Unless specified otherwise, stock options vest 25% one
year from the grant date and the remaining 75% vest in
successive equal semi-annual instalments over the succeeding
three year period until the stock options are fully vested. The
HomeRelay Plan has a life of 10 years and will expire on
29th August 2010.
No stock option may be granted to any employee if it would
result in the total amount of stock option to be issued or already
issued to him under the HomeRelay Plan exceeding 25% of the
maximum aggregate amount of stock subject to the HomeRelay
Plan. The exercise price under the HomeRelay Plan will be as
follows: (i) incentive stock options — an amount equal to not
less than 100% of the Fair Market Value (as defined in the
HomeRelay Plan) of the stock at the date of grant; (ii) non-
statutory stock options — an amount equal to not less than 85%
of the Fair Market Value of the stock at the date of grant; and (iii)
incentive stock options to 10% (as defined in the HomeRelay
Plan) — an amount equal to not less than 110% of the Fair
Market Value of the stock at the date of grant.
As at 31st March 2003, the number of shares issuable under the
stock options granted pursuant to the HomeRelay Plan was
705,475, which represented approximately 8.8% of the issued share
capital of HomeRelay. The movements in the number of stock
options under the HomeRelay Plan during the year were as follows:
Number of Number of Number of
Balance in share options share options share options Balance in
Weighted average issue at granted exercised lapsed/cancelled issue at
Date of grant (Note 1) exercise price Exercisable period 1st April 2002 during the year during the year during the year 31st March 2003
1st September 2000 US$1.0 1st September 2000 705,475 — — — 705,475
to 22nd February 2001 to 21st February 2011
Note 1: The stock options were granted to the employees concerned during the
said period and the information can only be shown within a reasonable
range in this report.
Warrants Pursuant to a warrant instrument dated 19th January
2000 issued by the Company to AT&T Corp. (“AT&T”) as part of a
trademark licence agreement between the Company and AT&T
pursuant to which AT&T granted the Company the exclusive right
to use the AT&T brand for 10 years in connection with the
manufacture and sale of wireless telephones and accessories in
the United States and Canada, the Company granted AT&T
warrants carrying rights to subscribe for 3,000,000 shares in the
Company at a subscription price of HK$20.0 per share on or
before 18th January 2012.
Pursuant to a Revised AT&T Brand License Agreement dated
24th January 2002, the subscription price of these warrants was
revised to HK$8.43 (being the lower of the initial subscription price
of HK$20.0 and the average of the closing price of the shares of the
Company as quoted on The Stock Exchange of Hong Kong Limited
for the five (5) dealing days immediately preceding 15th July 2002).
No warrants have been exercised since the date of grant.